Ukraine still waits for government

12:07, 05 November 2007

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The sluggish pace of the new government’s formation has led to frustration not only among Ukraine’s voters, but also among international investors and officials who must wait to finalize meetings, agreements, and future plans...

More than one month since Ukraine’s parliamentary election, the country remains in leadership limbo, as negotiations over a new government drag on. While a government coalition including the Bloc of Yulia Tymoshenko (BYuT) and President Viktor Yushchenko`s Our Ukraine-People`s Self-Defense Bloc (OU-PSD) has seemed likely since preliminary results were released, the lengthy negotiations suggest that this is not a done deal. Some within OU-PSD instead are encouraging a coalition with the party of the current Prime Minister Viktor Yanukovych.

The sluggish pace of the new government’s formation has led to frustration not only among Ukraine’s voters, but also among international investors and officials who must wait to finalize meetings, agreements, and future plans. It is difficult, after all, to negotiate over things like WTO membership, visa protocols, future gas deals, and implementation of EU cooperation accords when there is no final word on who will be in charge next month.

This is particularly problematic since a new government led by Yulia Tymoshenko—Ukraine`s former prime minister and current opposition leader—would differ significantly from that of the Yanukovych government. In particular, while the Yanukovych government drastically has slowed reforms, including those necessary for WTO membership, Tymoshenko has vowed to implement rapid Western-style reforms. It is not a surprise that the greatest progress toward WTO membership since 2004 came during the nine months of Tymoshenko’s premiership.

However, Tymoshenko needs the support of President Viktor Yushchenko’s Our Ukraine-People’s Self-Defense (OU-PSD) to return to the prime minister’s post. While the vast majority of OU-PSD members strongly support such a coalition, a small group of roughly 15 deputies within the bloc prefers a coalition with Yanukovych’s Party of Regions. Furthermore, Yushchenko has been lukewarm on the idea of a premiership for a woman he views as a rival, particularly since the prime minister’s position has about equal power to that of the president. This same issue helped lead to her dismissal in 2005.

The negotiation process also has been stalled by inexplicable delays in submitting election count protocols to the Central Election Commission and now-dismissed court challenges to the results.

Despite the political stagnation resulting from the lack of a clear plan for government formation, the majority of Ukraine’s politicians seem unconcerned. It is now likely that the new parliament will not sit until the end of the week of November 4 at the earliest. A vote for a new government, it seems, could take yet another week (at least). The calls of the Bloc of Yulia Tymoshenko and its allies in OU-PSD for a speedy confirmation of the coalition government have fallen on the deafest of ears.

This scenario is precisely one that EU officials hoped Ukraine would avoid. The country has been mired in a series of political crises since Tymoshenko’s dismissal in September of 2005. In March 2006, Yushchenko and Tymoshenko could not overcome differences following regular parliamentary elections, in order to form a new majority coalition and government. Instead, Yushchenko agreed to the premiership of Yanukovych—his 2004 presidential opponent—after almost five months of negotiations, while the country was overseen by a caretaker government. The negotiated agreements were never fulfilled, leading to Yushchenko’s dismissal of parliament and last month’s snap elections.

The worst scenario for Ukraine would be to repeat those missteps. And yet, Yushchenko remains reluctant to embrace a coalition with BYuT fully. In recent statements calling for a “democratic coalition,” he rarely speaks Tymoshenko’s name or the name of her political bloc.

Most recently, Yushchenko suggested that the signing of a new "unity pact" by the country`s political leaders "would be welcomed." (1) The first such pact was signed by Yushchenko, Yanukovych and other party leaders in 2006, and the five-page document was said to provide the foundation for all future policy decisions in the country. “The basics of the definition of Ukraine`s domestic and foreign policy, of its continuity, have been completed,” Yushchenko said at the time. (2)

Tymoshenko refused to sign that document, suggesting it was unworkable and essentially worthless. In essence, the document was designed to remove all differences among parties by committing them to the pursuit of one vague "national" program. Following the pact, Yushchenko introduced Yanukovych`s name to become premier.

Less than two months later, the "pact" was in tatters. "Ukraine`s process of integration into the WTO is being wrecked, the program of Ukraine`s accession to the EU has been basically stopped and there has been a fundamental block on Ukraine`s entry into NATO,” Yushchenko`s bloc said. (3) The bloc suggested Yanukovych was not following the policies agreed upon in the pact. Within one year, Yushchenko had dissolved parliament, accusing Yanukovych`s party of "betrayal." (4)

Yet inexplicably, Yushchenko is considering repeating the same idea. It is likely that Tymoshenko again will refuse to sign a "unity agreement" with Yanukovych`s party and the Communist Party, since their programs differ so greatly. This could create new potential for disagreement between the two former Orange leaders.

In order to meet Yushchenko`s concerns, Tymoshenko has proposed a sweeping new Law on the Opposition, which would give Yanukovych`s party—as the largest in the opposition—unprecedented rights to control parliamentary committees overseeing the budget process. She also has agreed to grant the opposition a new position of Deputy Prime Minister for Relations with the Parliament and several deputy minister portfolios. It is unclear why a new "pact" would be needed, given these concessions.

As these discussions continue, Ukrainians sit and wait for a government, much as they’ve been sitting and waiting for most of the last two years. Since 2004’s Orange Revolution, Ukraine has seen three Prime Ministers and many more changes at the level of minister. Fully 13 months of this time, the governments have been forced to function in a caretaker fashion, unable to implement changes or new initiatives. The country has had no functioning parliament for eight months this year, following its dismissal. But Ukraine’s leaders are in no rush to usher in a new government.

This may be partly to force Tymoshenko into concessions, and partly to ensure that some individuals are able to maximize their informal “severance packages.” It is no secret in Ukraine that outgoing governments and/or ministers routinely receive (or create) “deals” involving property or other financial bonuses from the state. More time likely equals more deals – and a larger budget deficit for the new government.

In the meantime, Western governments are left to puzzle over Ukraine’s inability to form a stable parliamentary majority and cabinet. Prior to the elections, several Western representatives privately suggested that, following the poll, Ukraine’s leaders had a perfect opportunity to demonstrate their ability to work efficiently, decisively and productively – an ability they have not shown abundantly in the past. While many promises have been made since 2004’s Orange Revolution, very few have been kept. Ukraine has been unable to reform its tax, customs, justice, or security systems. Should the country continue to be mired in political crisis, indecision and confusion, it risks not only angering voters, but also losing its international credibility.